Global macro overview for 10/10/2017:
The National Australia Bank Business Confidence Index has beaten market expectations. Global investors expected a slight jump in the index from 5 to 6 points, but the number revealed was at 7 points in September. The dip in the prior month was caused by concerns regarding geopolitical tensions with North Korea. In addition, data showed that business conditions held steady at the 15 mark. Overall, the Australian companies' outlook remains upbeat, as the figures indicated that the business sector was doing well in the reported period. The only sector of the Australian economy that proved to be the stark exception to generally stronger conditions across the corporate landscape in September was retail sector, who continued its downward trend and fell back into negative territory last month. On the other hand, the construction sector continues to lead the index with the highest business conditions in September.
This comprehensive survey of the current state of the business sector in Australia (based on a survey of hundreds of small and large sized companies), primarily provides insight into the state of the Australian economy and puts forth leading indicators that signal its future direction. Thus the survey's findings, if unexpected, have the power to move markets directly.
Let's now take a look at the AUD/USD technical picture at the H4 time frame. After a dip below the daily time frame technical support at the level of 0.7750, the market bounced and is currently trying to rally higher to test the technical resistance at the level of 0.7808. The market conditions remain oversold, but the momentum is about to break out its fifty level, which supports the current view. The larger time frame trend remains bearish.
